Letuka Chafotsa
THE unfolding political crisis is has taken its toll on local industry and is scuttling foreign direct investment, the Lesotho National Development Corporation (LNDC) Caretaker Chief Executive, Tseko Bohloa, has said.
Lesotho has been on a knife-edge since 30 August after the Lesotho Defence Force attacked three key police stations in Maseru resulting in Prime Minister Thomas Thabane fleeing to South Africa.
Although the premier has since returned home, the political instability has wreaked havoc on local businesses and put off foreign investors who have thought twice about investing in Lesotho.
“We had two investors who opted out of this country and, instead, went to Botswana to assess business prospects there, which is indicative of the losses we are incurring owing to the political instability,” Mr Bohloa said.
According to Mr Bohloa, the role of the LNDC is to promote Lesotho as an attractive investment destination for both foreign and indigenous investors, a now difficult proposition following the events of the past two weeks.
The LNDC, he said, is sparing no effort in ensuring the country retains investors already in the country by assuring them that their businesses are secured.
“On Friday we will engage various security agencies and work in collaboration with the police to ensure investors do not close their shops in fear,” Mr Bohloa added.
Meanwhile, the Lesotho Times sought the views of various stakeholders in business on the impact of the current political crisis on the investment climate.
The Private Sector Foundation of Lesotho Secretary, Thabo Qhesi, said the investment and business climate is being undermined by the uncertainty in the country, adding that it is a deterrent to potential investors.
“Investors are holding on to their money since our country is facing huge political challenges as we speak,” Mr Qhesi said.
“Suppliers too are now reluctant to distribute goods and other valuable services since they fear their goods can be looted or confiscated due to the current political crisis and instability.
“There is also the risk of prices being hiked,which will negatively impact on Basotho, if this crisis drags on.”
Mr Qhesi singled out the hospitality and tourism sectors as the major casualties of the political crisis.
“The tourism industry is feeling the pinch of a drastic decline in the inflow of tourists as well as decreased spending by both corporate and individual consumers”, he explained.
“Businesses have reported a downturn in revenue for lodging, food service, events and other hospitality services. The decline resulted not only from fewer customers in hotels, restaurants, conference and convention centres, but also from a significant decline in the average expenditure per guest, which is great loss to the economy.”
The Bankers’ Association of Lesotho (BAL) chairperson, Manyathela Kheleli, weighed in saying the banking sector had not been spared from the political upheaval.
Mr Kheleli, who is also the public relations and communications manager for Standard Lesotho Bank, said: “Our business is centralised on the money of customers, so what affects our customers affects us too.”
“So the situation has negatively affected us and we are hopeful the peace talks and negotiations will result in the restoration of tranquility for us to recoup our losses.”
